What We’re Doing To Adjust To One Income

Contando Dinheiro

As I told you yesterday we’re moving from a two income family to one income. This will take some adjusting on our part.  If you’re considering moving from two incomes to one you should check out 9 Tips For Going To One Income from PT Money.

Among the things we have done so far to adjust:

  • Changed my 401(k) contributions – I was contributing more than the company match for my 401(k).  I’ve now lowered it to the company match.  Anything lower than the company match and I would be missing out on free money.
  • Roth IRA contributions – We lowered our monthly contribution to our Roth IRA’s.  Yes it’s important to save for retirement but for right now we need to make sure we can handle our new budget constraints.  If we find we have enough left over we’ll up the amount.
  • 529 Plans - Again, it’s important that our kids are able to go to college but having money now is more important.  We didn’t eliminate contributions, just lowered them.
  • Tax Withholding – With my wife not working I plan to change my tax withholding so I can keep more of my paycheck.  We’re waiting to hear back from our accountant for advice on what we should set my withholding for.
  • Health Care – Our health care was through my wife’s job.  I’ll have to switch it over to my company’s once my wife’s coverage officially ends.  This will cost us as my wife had free coverage and I don’t.  We had to keep this in mind when we worked out our budget.
  • Look for ways to trim expenses – The Starbucks days are coming to an end.  And now when we go to Target or BJ’s we’ll go in with a set list of things we need and not buy things we want.
  • Work on finding alternate sources of income – We’re keeping an eye out to see if there are any ways to earn some extra money.  I’d love to say this site would help support us but blogging isn’t as lucrative as some make it out to be.
  • Go through all of our monthly bills/expenses – We made sure to see where our money was going monthly.  We didn’t want to build a budget then find out we skipped something that would make us go over.  Make sure you check for any automatic contributions or payments you may have set up!

This will be a big adjustment for us but it will be worth it.  We’ve saved and planned and budgeted and I think we’ll be fine.  A little tighter than we used to be but fine.

Do you have any other ideas?

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Creative Commons License photo credit: Jeff Belmonte

What Is Raising A Child Worth – We’re Going To One Income

island hopping

What is it worth to raise your child? Is it worth giving up an income?  For us the answer will be yes.  First the first time in a long while my wife will not be heading back to work this September (she works in education).  Instead she will be staying home to raise our little guy and our princess (19 months and 8 yrs old respectively).  This wasn’t an easy decision for us.  Giving up her income will require us to be a lot more frugal and we’ll really have to watch our spending now.  Our future savings will also decrease as we won’t have as much to put away.  We have  a nice cushion already and I think we can do this; it just requires us to change our lifestyle.

Here is why we’re moving to one income:

  • Child Care Cost – We were paying a LOT in child care.  And yet for all we were paying our son was getting sick way too often, catching bugs from the other kids at day care.  Not that the day care was bad; it’s just inevitable that a child gets sick and spreads it around.
  • Sick Days – My wife took a lot of sick days during the last school year.  As I mentioned the little guy was getting sick a lot.  Day care is supposed to help us go to work but it was causing a lot of stress instead.  Let’s face it, it’s painful seeing your child sick and not be able to do much about it.  And my wife was getting to a point where her sick days were going to start costing her.
  • Stress of getting around and making arrangements - Mornings were hectic to say the least in our home.  Getting two kids ready and getting to work on time s a big deal.  The evening before we had to make sure everything was prepared and laid out for the next day.  Then there’s actually dropping the little guy off and picking him up (sitting in traffic, finding a spot, etc…).  Ever leave you child with someone else and have him cry for you?  It will break your heart!  We also had to find arrangements for our daughter after school for a good part of the year.  And because I was dropping her off in the morning I was getting to work and leaving later.
  • Enjoying raising our children – Last on this list but first in our hearts, the main reason for my wife staying home to raise the kids is because we feel it’s the right thing to do.  We feel strongly about being there for our children in their formative years.  My wife originally intended to take more time out when the little guy was born but she ended up going back anyway.  Now she will take the time off to be there for them.

It’s a shame that in today’s economy having a parent stay at home to raise the kids has to be a difficult decision.  When did it switch from a second income being gravy to it being just about necessary?

Stay tuned to see what we have done so far to adjust to one income!

Have you moved from two incomes to one?  How is it working for you?

Creative Commons License photo credit: quarxdmz

Not Having The Police At A Car Accident Can Cost You

Car crash

As I mentioned in an earlier article, our new car got into an accident on our vacation driving down to Virginia. The weather had recently turned to rain.  We were driving along the highway below the speed limit making sure to keep a safe distance from the car in front.  Suddenly traffic slowed down so we did as well.  Then I saw it coming in the rear-view mirror – BAMM!!  We just got hit from behind. The force was enough to throw us forward.  I moved to avoid the car in front but ended up clipping his fender.  All three cars pulled off to the side of the road.  Thank goodness no one was hurt!  The kids were shaken up (heck, we were all shaken up) but we were OK.  I got out and assessed the damage.  Man I didn’t realize how bad we were hit.  Back door was crunched inward.  At first I couldn’t even open it.  Our front has a small dent as well.  The other two cars – scratches at best.  It was an SUV Oreo and our poor mini van was the creamy middle.

Still a bit frazzled from the accident the other two drivers and I began to exchange automobile insurance information.  The person who hit me was in a rush to leave.  He didn’t think we needed to call the police since no one was hurt and we were exchanging info already.  Something didn’t feel right about this to me.  Thankfully, I listened to my Spidey sense and called the police.  A few minutes later an officer arrived and took all of our information.

What A Police Officer Does At The Accident

  • The officer took all of our pertinent information and heard separate descriptions of what happened from each of us. This was good because the officer gave us each a Driver Information Exchange Report which listed car insurance information, driver’s license #, address, phone number, car description VIN, and more.  After an accident it’s easy for a driver to forget to get a piece of information or write something down incorrectly.  Getting this from a police officer helps to prevent that.
  • I didn’t know it at the time but you could be given a ticket for driving too close and causing an accident (at least where I was). This may have been one of the key reasons the driver who hit me wanted to leave.  It ends up the officer gave him a written warning.  This is very important in that it gives official evidence that the officer felt it was the driver’s fault for causing the accident!  This will help in determining the fault for the insurance companies which will lead to me getting back my car insurance deductible from repairs on my accident claims (my deductible is $1000).
  • The officer filed a police report for the accident. The insurance companies will use this as well in determining the fault.  Without getting a police report you run the risk of a driver changing his story after the fact and it becomes an issue of his word against yours.  Again this will help in getting my deductible back.
  • Having an officer there helps keep everyone’s heads level. Things can get heated when there’s an accident.  I’d rather have the officer do the peace keeping than worry about it myself.  Also, I want to believe in the best in people but I don’t know the person who hit me from Adam.  An officer can confirm that this isn’t a criminal.  A little paranoid?  Yes.  Does it give me additional peace of mind at a stressful moment?  Heck yeah!

As you can see calling the police was important. With the written warning and the police report the automobile insurance company should see that the fault was on the other driver.  This will save me my insurance deductible of $1000.  Had I not called it could possibly cost me that $1000!

Creative Commons License photo credit: Mr Wabu

Booking A Hotel Through An Online Travel Site May Not Be Worth It

In planning our recent trip to Virginia Beach I discovered that using an online travel site isn’t always worth it.  In fact they could be ripping you off!

every time we say goodbye

We finally decided on going to Virginia Beach and we wanted to stay as close to the beach as possible.  At the same time we really didn’t know much about the area.

My wife and I scoured the various travel sites such as Expedia, Orbitz, Hotels.com, etc…  Whenever we saw something interesting we checked it in Trip Advisor to see what kind of feedback people who stayed there had.  We tried to find out what we could about the area and what was available.  Because we waited so long to plan our trip many hotels were either booked on certain days or too expensive.  Finally, through one of the sites (I won’t mention which), we found a decent hotel with a rate we were OK with paying.

Here’s where it gets interesting.

So we found a good rate for a room.  We discovered that for $10 more a night we could also get a Continental breakfast included.  Ten dollars more a night to get the four of us going in the morning sounded like a good deal!

Before I was able to reserve the room, my wife, in her mighty wisdom, told me to check out the hotel’s site and maybe give them a call to see what they charge.  Good thing she told me that.  I checked the hotel site and I found that their rooms were the same price as the online travel site.

Ok, no biggie.

Then I discovered that the Continental breakfast was included in all the reservations!!  The travel site was going to charge me $10 a night for something the hotel gave out for free!  It gets better.  We found that the hotel gives discounts to AAA members.  I plugged in our membership card and was pleased to see that the room would be discounted another $18!

In all we saved $28 a night by going directly to the hotel’s site rather than booking through an outside travel site!  Over five nights that’s a savings of $140.

I’m sure there are real great deals out there on these travel sites but this proves that you have to do your homework.

Sometimes the best deals may be from the hotel itself!

What travel tips do you have?

Creative Commons License photo credit: [charlie cravero]

Our Vacation To Virginia Beach And Such

We got back a few days ago from our trip to Virginia Beach. According to Google Maps this was around 380 miles and should take about 7 and 1/2 hours to get there (more on that later).  We drove down on Sunday morning and came back Friday evening.

I was originally going to call this our “staycation” but it seems that staycation really means that you stay home and go to local attractions.  Still, this was our first driving vacation.  In previous years we would fly to our destinations.  Since we just bought a new mini-van we figured it would be a great time to drive and save money on plane fare too!  Virginia Beach seemed close enough to drive to from NYC and we heard a lot of great things about it.

So we packed up our stuff and put the kids in the car and left Sunday morning.  Many, many hours and rest stops later we finally made it to Virginia Beach (we had a major delay at one point but more on that later).  It was basically an all day drive for us, what with stops and all.  One exciting about the drive was going over the Chesapeake Bay Bridge-Tunnel which spans 20 miles (on the way back we saw what might have been a a Navy Destroyer passing through the channel section).  It was also interesting to see all of the different towns and landscapes in the different states (four total: New Jersey, Delaware, Maryland, and Virginia).

Virginia Beach is beautiful! Our hotel really was just two quick blocks to the beach!  There was a beautiful boardwalk on the beach to walk along with a separate trail for bikes (we wanted to rent a bike for all of us but we didn’t get a chance).  Within two from the beach are places to eat (the four main  food sources seem to be seafood, ice cream, waffle/pancakes, and pizza), shops, a fun house, a haunted house, lots of ice cream shops, outdoor performance areas, miniature golf, and more!  It was really fun to walk around at night and take in the scenery.  In fact one of the performances we saw was the Edgar Winter Group at a bandstand right off the beach (we caught Frankenstein and Free Ride)!

An interesting thing we discovered was that Virginia Beach is close to a Naval base.  As a result there are military jets flying routes overhead all day.  Living near two airports in Queens, NY I’m used to hearing planes overhead but seeing military jets is different.  The last time I saw a military jet flying was on September 11th over the Empire State Building so it brought back some somber memories.  Once I got used to that though it was pretty awesome seeing the jets flying.  At times we would see three together flying in close formation.  If we ever go back we’ll have to tour the Naval base!

Funny story…One day my daughter wanted to go to the pool rather than go to the beach.  She couldn’t quite grasp that we didn’t drive 400 miles to go to a small hotel pool!  Well the beach won out.  As I was playing with her, jumping waves I saw a fin a little ways off.  I noticed it was a curved fin.  I told I thought I saw a dolphon but wasn’t sure.  She got worried thinking it could be a shark!  A few minutes later I saw for sure two dolphins swim to the surface.  Other people noticed it too.  In all there were about four dolphins swimming around and playing a little ways off from us.  We saw a couple jump out of the water and twist.  We must have watched them swim around on and off for the next hour!  At one point, holding my daughter up to see the dolphins, I asked her if she would have rather stayed at the pool.  Begrudgingly she said no, that it was much more fun at the beach.  Ha!  On a similar note, I had seen dolphin watching boat rides advertised for about $20 a person.  We saved a bundle by just going to the beach instead!

As well as the beach and the local scenery we also went to the Virginia Beach Aquarium and spent a day in Colonial Williamsburg.  The little princess loved seeing all of the old time building and costumes.

Remember how I said Google Maps said the trip should be 7-8 hours?  I’ve discovered that with two kids we have to add at least 30% to the time listed!  Coming home took much longer with stops and traffic entering NYC.

The trip was a lot of fun and I would definitely consider going back to Virginia Beach but it seems for us every silver cloud has a lead lining.  While driving down there we got into a car accident.  We got rear ended on the highway.  Our brand new car now has a dent in the front and a smashed in rear door.  No one was hurt and the car runs but it really hurts to have a new car get beat up like that.  The accident was the other person’s fault and insurance should cover the repairs but it did put an ill feeling over the trip.  We even considered going back home after the accident but we’re glad we went through with the trip.

In all I think we saved money by not flying off someplace.  We certainly spent money but it was less than we would have flying to a Caribbean locale.

Accident aside, we had fun and I think we have more driving trips in our future. As you can see from the Frugal Things To Do series there’s so much to see and do in this country!  Even a couple of days before the big trip we went out to Sesame Place and a couple of weeks earlier we went to the Bronx Zoo.

We Did It, We Bought A New Car

honda-odyssey


We did it!  We broke down and decided it was time for a new car.

We bought a brand new 2008 Honda Odyssey EX.  We picked it up last week and we love it so far!  I feel a little guilty saying that since hey, a new car costs money, but I think we did it as cost-saving as we could.

See, we could have stuck with our 2004 Toyota Corolla, which was a great car.  It had a relatively good number of miles on it and it ran well.  Thing is, it was getting too small for our family.  We’ve been getting by finding ways to fit everything into the trunk of the car on various outings.

Shopping at BJ’s was always fun since we had to get things like diaper and wipes boxes into the trunk as well as the stroller (remember, we have two kids one of which is a toddler).  On some days we got real close to not fitting everything.

The other things was we really couldn’t fit any more people than the four of us.  Maybe we could squeeze a friend of my daughter’s in but that was it.  We wanted to be able to transport more people if we wanted (and hey, there’s always the possibility of more little ones too).

Let me show you what we did to keep costs down:

We traded in our Corolla

We considered keeping it but we didn’t need two cars.  We were better off putting the car toward the cost of the Odyssey.

We researched and then researched some more and then shopped around

We checked Consumer Reports, Edmunds.com, the official Honda site, the Official Toyota site…We looked everywhere we could to make sure we understood what the dealer costs were and what prices we could expect to get for both the new car and our old car.  With this information we shopped around until we found the best price from a dealer.  In the end, after an odyssey of our own, we received a price that we were happy with (much less than MSRP and lower than dealer invoice).

We added some luxury but not the works

I wanted power side doors which put us up higher than the base model.  After that we didn’t go for any other options.  As much as we would have liked them we didn’t get the navigation system, the DVD player, the leather seats, etc…  We looked at what we knew we needed and wanted and stuck with that.

We got a great financing deal

I know, buying a 2-3 year old car and paying for it in cash is what a lot of experts say is the best thing to do.  We’ve had bad experiences with older cars already and we know we are going to use this car for as long as we are able (many, many years we hope!).  We considered a used car but in the end we wanted new.  One thing that helped decide was the fact that Honda is offering 0.9% financing right now (Toyota was offering 0% but we preferred the Honda overall).  Financing for 0.9% is real close to free money (a great reason to make sure your credit score is good).

So you know, we have enough put away that we could have paid the car off entirely but since the rate is so low we can keep the money in our Capital One 360 Savings account and let it earn interest while we pay the fianancing.  I did some quick calculations and our financing is costing us less than $300 while we could earn around $1,800 keeping the money in our savings.  For a used car the fianncing would have been much higher.

Our insurance will be lower

As an added bonus I found out that our auto insurance premiums will be lower since the Odyssey is considered a safer car.

Our vacation will be more local

We were undecided on what to do for vacation this year.  We were strongly considering flying off somewhere that has Caribbean water.  But now that we have a new car with more storage space we’re going to do a driving vacation and travel within a day or two’s distance and check out the sites.  Yes gas is expensive now, but we’ll still be saving more than if we flew somewhere.

Finally

We have a little bit of buyer’s remorse knowing that we have a debt to pay off but we’re really happy to have gotten the car!  We’ve already taken a couple of small trips and we plan to do some more (there’s a frugal list of things to do somewhere out there isn’t there?).

A car is a great big expense.  But I think we purchased ours in a way that’s financially responsible.

Do You Have Frugal Tips For Your City?

If you’ve been keeping up on things then you know the Money Life Network has just finished our series “Frugal Things To Do In…” where we listed out great things to do in each of the cities we live in.  Check out the great map showing all of our locations!

Things is though, there’s only seven of us in the Money Life Network and that barely puts a dent in the map.  We need your help to fill the map up!  If you have a blog then write about frugal things to do in your city , link back to us and contact us and we’ll add you to our map.

Check out the Money Life Network cities:

Now let’s fill up that map!